DOJ Wants to Extend Oversight of Microsoft to 2009

Citing Microsoft Corp.'s lapses under part of a landmark antitrust settlement,
the Justice Department said Friday it wants to extend by two years its oversight
of some of the company's business practices until at least November 2009.

Microsoft has already agreed to the lengthier scrutiny by the department and
17 states under a proposal that still must be approved by a U.S. judge. The
company has struggled with a key provision in the 2002 antitrust settlement
requiring it to disclose to its competitors sensitive details about some of
its software.

Government lawyers said they were prepared to extend oversight of Microsoft's
business activities through 2012 if they deem it necessary. In court papers
filed Friday, they described Microsoft's efforts under parts of the settlement
as "disappointing" and "not very encouraging," but they
also said Microsoft's failures were neither willful nor systematic.

If the longer term is eventually approved by the judge, the U.S. court battle
against Microsoft would stretch to at least 11 years -- the age of a middle-schooler
-- before it concludes.

During that period, Microsoft will have sold at least five generations of its
flagship Windows software. At the same time, Google Inc. has emerged as one
of Microsoft's biggest rivals, iPods and BlackBerries have revolutionized portable
gadgets and technology executives have made and lost billions.

Lawyers said there was little chance U.S. District Judge Colleen Kollar-Kotelly
would reject the proposed extension because she has expressed concerns in recent
years about Microsoft complying with that part of the settlement, which she
has described as among its most important requirements.

Microsoft's top lawyer, Brad Smith, said the extension was "an important
step" and gives the company time to finish technical documents that describe
the inner workings its software.

Government lawyers said Microsoft's earlier efforts were so dismal even the
company agreed it needed to "reset" the program. The Justice Department
quoted Renaissance philosopher Niccolo Machiavelli to describe Microsoft's lapses:
"He who has not first laid his foundations may be able with great ability
to lay them afterwards, but they will be laid with trouble to the architect
and danger to the building."

The literary reference was no accident. The judge, Kollar-Kotelly, also had
quoted Machiavelli when she approved the antitrust settlement in November 2002.
In a passage warning Microsoft to abide by the agreement, she wrote: "Let
it not be said of Microsoft that 'a prince never lacks legitimate reasons to
break his promise.'"

The top Justice Department lawyer on the case promised the government will
vigorously enforce the antitrust settlement.

"This extension will ensure that companies interested in licensing the
communications protocols receive the benefit of complete and accurate documentation
for the full period of time provided by the court's final judgment," said
J. Bruce McDonald, the department's No. 2 antitrust official.

The 2002 antitrust settlement required Microsoft to offer its technology to
competitors to build products that seamlessly communicate with computers running
Windows software. When the settlement was negotiated, the judge and government
lawyers described that requirement as among its most significant provisions
toward restoring competition in the technology industry.

The extended scrutiny comes as Microsoft faces intense competition from Google
and Yahoo Inc. Microsoft is concerned those companies' Web-based offerings,
including e-mail and instant messaging, could threaten its Windows software.
Google also is making inroads on the desktop itself, with offerings that include
search electronic documents.

Google had informally complained to U.S. and European regulators about the
new version of Microsoft's Web browser, which will ship with its upcoming Windows
software known as Vista. Google said the browser improperly steers people to
Microsoft's search engine instead of Google's more popular technology, but the
Justice Department disclosed in its legal papers that it will take no action.

The government said Microsoft's new Web browser respects the choices of consumers
and computer makers, and its settings can be easily changed.

McDonald's new boss at the Justice Department, Thomas O. Barnett, has recused
himself from the Microsoft case because his former law firm worked for Microsoft.

The 17 states that sued Microsoft with the Justice Department are: California,
Connecticut, Florida, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maryland,
Massachusetts, Michigan, Minnesota, New York, North Carolina, Ohio, Utah, Wisconsin
and the District of Columbia.